CP Daily: Friday November 9, 2018

Published 22:49 on November 9, 2018  /  Last updated at 22:49 on November 9, 2018  /  Newsletter  /  No Comments

A daily summary of our news plus bite-sized updates from around the world.

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TOP STORY

ANALYSIS: Power sector continues to drive California GHG cuts, but for how long?

California saw significant GHG reductions in 2017 as renewable and hydroelectric power displaced natural gas-fired generation, but stakeholders question whether the trend will continue for much longer.

EMEA

German finance ministry shoots down Schulze’s domestic CO2 price expansion plan

Germany’s finance ministry has shot down Environment Minister Svenja Schulze’s plan to expand carbon pricing domestically.

EU Market: EUAs fall back after failing to breach €20

EUAs briefly tumbled back below €19 on Friday after early efforts to scale €20 failed, as speculators appeared to take pre-weekend profits built up during this week’s relief rally.

ASIA PACIFIC

Green group urges Japan coal phase-out by 2030, launch ETS next year

Japan should phase out all its coal-fired power plants by 2030, increase its ambition under the Paris Agreement, and introduce a price on carbon as soon as next year in order to do its share to limit global warming, green group Kiko Network said in a report Friday.

Australian offset issuance balloons to 458k as major ERF contractors earn credits

Australia’s Clean Energy Regulator this week issued 458,135 carbon credits, with the majority awarded to major sellers to the government’s Emissions Reduction Fund (ERF).

CN Markets: Pilot market data for week ending Nov. 9, 2018

Closing prices, ranges and volumes for China’s regional pilot carbon markets this week.

AMERICAS

Connecticut proposes amendment to adopt RGGI Model Rule changes

Connecticut published amendments Thursday that would implement the suite of post-2020 changes to the RGGI carbon market agreed to by the programme’s nine member states.

LCFS Market: California prices dip below $190 as market quiets down after data release

California Low Carbon Fuel Standard (LCFS) prices slunk back below $190 this week amid thin activity following data that showed the market to be more in a deficit than expected.

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BITE-SIZED UPDATES FROM AROUND THE WORLD

Keystone setback – A federal judge in Montana halted construction of TransCanada Corp’s 1,180-mile and $8 bln Keystone XL oil pipeline on Thursday on the grounds that the US government did not complete a full analysis of the climatic impact of the project. The ruling deals a major setback and could possibly delay the construction of the project greenlighted by the Trump administration. It also goes further than just climate, with the Washington Post reporting that the ruling demands a “more complete review of potential adverse impacts related to … cultural resources and endangered species.” (Reuters)

Same, same – Chinese government officials are in the process of finalising an allocation plan for the power sector to use as basis for the simulated ETS for generators, which is likely to start some time early next year. But – like pretty much every other place with a carbon market – scheme designers are running into opposition from big-emitting companies that feel the government’s initial proposals have been far too stringent, information providers Idea Carbon said Friday, citing unnamed sources. The allocation methodology for the trial scheme is likely to be adopted when the actual market starts, which is why the power industry’s lobby group is attaching great importance to it. The plan is scheduled to be finalised before the end of the year, Idea Carbon said.

Sure, go ahead – Natural resources continue to be good business in Australia, and the Western Australia state government on Friday gave final environmental approval for Albemarle Corp. to open the Kemerton lithium hydroxide manufacturing plant, which is expected to add some 250,000 tCO2e per year to Australia’s booming greenhouse gas emissions.

Free fallin’ – The cost of building and operating renewable electricity plants has dropped below the expense of keeping coal-fired plants running under some circumstances, according to a new study by financial advisory firm Lazard. In the analysis, the company found that the so-called levelised cost of energy (LCOE) of utility-scale solar voltaic projects fell another 13%, while onshore wind dropped another 7%. The low end of unsubsidised costs for onshore wind are now $29 per MWh, while the LCOE of utility-scale solar “is nearly identical to the illustrative marginal cost of coal, at $36/MWh”, according to a summary of the report. Although the analysis did not include certain costs like transmission and grid integration for new projects, in some cases it is now more cost effective to build new alternative energy projects than keep fossil fuel-powered ones open. (Axios)

Here we go again – After the US Supreme Court just lifted a stay of a youth-led climate trial last week, the Ninth Circuit Court of Appeals on Thursday once again halted the case at the behest of the Trump administration. The three-judge panel on the Ninth Circuit said that the administration “raises issues that warrant an answer”, and said a lower court must hold off now for a trial. Lawyers representing the children are now directed to file a reply to this inquiry by Nov. 23. (Politico)

Nuke doubts – The future of a UK new nuclear power station has been left in doubt after Toshiba announced that it is winding up its UK nuclear business on economic grounds. Industry experts say that China’s state-owned nuclear group would be interested in the Moorside project, but some figures in the British government are wary of bringing in the Shenzhen-based group. Meanwhile, Carbon Brief found that if the electricity Moorside would have generated is replaced by gas-fired power stations, it would add roughly 10 million tonnes of CO2e to the UK’s annual emissions. (Financial Times)

Take it off – The environmental NGOs participating in Germany’s coal exit commission have proposed to take around 16 GW of coal power capacity off grid by 2022, reports newswire dpa in an article carried by Die Welt. Greenpeace, Friends of the Earth Germany (BUND), and umbrella organisation DNR argue in the leaked paper that an additional 7.5 GW of lignite capacity should be transferred into Germany’s backup reserve by 2020, and that 8.6 GW of old hard coal capacity should be retired by 2022. BUND handed the proposal to environment minister Svenja Schulze (SPD). (Clean Energy Wire)

Pricey & illegal exit – Meanwhile, a legal opinion commissioned by coal power plant operator RWE argues a coal exit by policy decree would be unconstitutional, reports business daily Handelsblatt. The “renowned” energy law firm Posser Spieth Wolfers & Partners argues that in contrast to what coal exit proponents say, a ruling on the nuclear exit from 2016 cannot be applied to the coal exit. The legal experts say ordering shutdowns could become expensive, because this would likely entail compensation claims from operators. But the legal experts also say that an amicable agreement could clear the way for a coal exit. A legal opinion by law firm BeckerBüttnerHeld (BBH) had stated last year that a speedy coal exit without compensation payments is possible because most power stations are already written off because they are older than 25 years. (Clean Energy Wire)

LoNG-term deal – Poland’s state oil and gas company PGNiG signed a long-term contract Thursday to receive LNG deliveries from the US. The deal comes as Trump pushes for European nations to buy LNG from the US rather than increase their dependence on Russia. The signing sets into motion a 24-year deal with American supplier Cheniere. (Politico)

Rogue emissions – China will be urged to crack down on illegal production of potent warming gas CFC-11 in its borders under an international declaration set for adoption under the Montreal Protocol at a meeting in Ecuador this week. The chemical has been banned globally under the Montreal Protocol on ozone protection since 2010 but green group investigations suggest it still being used in China to make foam insulation. In a draft declaration, delegates called on all countries to “take appropriate measures” to enforce the international ban. (Climate Home)

Popping a wheelie – US-based automakers Ford and GM are branching out into the world of electric vehicles through bikes and scooters. Ford just paid almost $100 million to acquire Spin, an electric scooter-sharing company based in San Francisco with operations in 13 cities and campuses across the US. GM will launch a line of electrified bicycles in 2019. (Axios)

And finally… Why didn’t anyone think of this before?! – US researchers have successfully tested the rather whacky idea of producing electricity from a mushroom covered in bacteria, BBC reports. The scientists used 3D printing to attach clusters of energy-producing bugs to the cap of a button mushroom. The fungus provided the ideal environment to allow the cyanobacteria to generate a small amount of power. The researchers say their fossil-free “bionic mushroom” could have great potential, and that several wired up together could light a small lamp.

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